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reporting on oil since the 1990s and serves as director of american soil news at s&p global plasse andmister mauer, let's begin with a question you always get when people are paying more at the pump . why? >> it's a good question john and thanks for having me on . n,the basic answer is that demand for refined products is outstripping the supply for refined products but i want to back up a bit to 2020 and just explain what happened briefly when the coronavirus first hit especially earlier in the year and a really big and sudden drop in demand. it was around 20 million barrels a day possibly more and demand and global demand. so over a very short amount of time and it's a very sudden, much more deep drop and people had expected. that was between just say january and april that year. as you can imagine people are

driving, they'renot flying as much . as a result you had little companies, refiners start there's no reason for them to keep producing gasoline or jet fuel and diesel if fewer people are using it and then you have producers, they start cutting spending and start cutting production because again where are you going to put this. it starts going up with inventory, if the refineries aren't going to process through. so now we're at the point where we covered to some extent but the refinery runs haven't kept pace with the increase in demand so for instance, plastic analytics sees demand rising i think for the first 10 months of the year from january to october of this year saw demand global demand rise about 8 million barrels a day

over the same period, refinery runs usually see maybe 2 million barrels a day so around 70, 80 million barrels a day so you have this gap and rkthe tightness really is still in the refined products like in the united states for instance the inventories of gasoline, inventories of diesel are below the five-year average levels . so now the five-year average because last year inventories were so high. but still it's a fairly good indicator toshow that inventories are e still pretty tight . relative to the demand right now and that's what's causing the price to increase. >> and snapshot of the end resulthere . this is from aaa's gas map. the average price of gasoline today $3.41 a gallon. you can see viewers on this

map from aaa. the darkest red states where the average price is somewhere between $3.61 and $4.68. the light right light red states is an average between 341 and 361 and so on down the line over where pricesraare the highest in thecountry . and with those rising prices , questions in the white house briefing room about what the biden administration will do about it. here's a clip with jen saki from yesterday. >> there's some republicans will have taken gas prices to criticize the ministration picture. canceling keystone pipeline. holding leases for new drilling leases on federal lands saying that the administration's policies written large have contributed to the rising gas prices which what your response. >> our response is that we have not canceled existing.

their existing leases that are continuing just to be clear i know you know that. not new leases but to be clear i don't expect criticism so that's why isaid it . our view is that the rising gas prices over the long term makes it even stronger case for doubling down our investment on our focus on clean energy options so that we are not reliant on the fluctuations and opec and their willingness to put more supply and meet the demands in the market. that's our view. we feel that we also feel there are a number of factors here including price gouging that we have concerns and we seen out there the scene asked the ftc to lookinto the need for opec torelease more . that are the larger issues here and that's why we've been focused on those options . >> jen from friday in the white house briefing room. jeff mauer today as we're having this discussion jim psaki bringing up opec.

>> opec definitely has been increasing production. and continuing to increase production around 400,000 barrels a day and holding until next year. in october they increased production by 480,000 barrels a day . but there's being cautious and i think other producers are being cautious too and that's something i want to stress here so opec says look, we can boost production but we can only boost production as much as refiners need. if there's not enough refining capacity going on coming online, there's no need for us toboost production because where's the crew going to go ? it puts into storage so the way the market is structured right now in crude into storage doesn't really make you any money. there's no financial incentive for crude storage right now. so i get there point of view.

when it comes to that because when you think of the independent oil producers as well outside of opec, they're doing the same thing. even more so. they're saying look, we can increase production a little bit but we want to stay within certain targets. we promised our shareholders that we are going to retain tightened down on production because we don't want toflood the market with too much oil . at a time where there's still a lot ofquestions about the coronavirus . there's waves of record levels in germany recently and increase in cases in china so i think there's still a lot of concern there about how do we recover without putting too much oil on the market. and repeating at least a little bit of what we saw in

2020. so i think that's a real concern. but the interesting thing is i think we will see refinery runs increase so gasoline prices on the futures market have risen over the last several months or years. but in recent days over the last couple of weeks i noticed they did come down a bit and maybe there's something to that. part of it is the concern about the coronavirus cases but i think also you just see some refining capacity returning . and in the us refinery runs work out fairly low in recent months. for one reason because of hurricane activity that shut down some gulf coast refineries. those are now coming back. i think refinery runs were

stagnant over working or 15 barrels a day and now they're expected to rise. we seen a rise up to around 16 crude barrels a day this month and globally the iea came out today and said they see global refinery runs climbing something like 3 and a half million barrels a day over the next couple of months so what that will do is increase the supply of gasoline and diesel onto the market. >> but again, i was going to say again there's so much it really depends on what demand does over the next couple of months. you're going to see more people driving because of the holidays, or are you going to see more people flying? it's hard to tell business travel is way down and i don't think that's effective a recovery back to pre-

covid-19 levels for years so maybe more people are going to be traveling for the holidays but you know, a lot of that depends on it, how much are people going to be out yshopping and eating and so on and so forth. >> if you want to start gas prices, oil places, s&p global class, likes to call in eastern or central time zone h74 824-8000. mister mauer, briefly explain what class is for folks who are unfamiliar . >> platz is a partner s&p global class, we assess and report on commodities around the world. so hethe vision division i work for is the oil division so i managed the americas news. division but we report on you know, gasoline and crude metals. natural gas, you name it.

just agriculture around the world.we report and prices around the world and that's where our expertise comes in handy here because we have a really good insight into very specific markets around the world. that's not just dereporting on a futures benchmark so in the case of oil it's not just reporting on the ice bread futures for the nine index crude futures. it's recording on all the different brands of crude that aretraded around the world every day all in different grades of gasoline and locations . different locations, different grades and the real fascinating thing about that is that you really see the complexity of it. you get an idea of the for instance yesterday i was reading a story about how expensive lights crude is in

north europe right now. and how many more imports and how that's pulling more imports of us crude into that region. and you wouldn't really necessarily see that by looking at futures markets . you see it by looking at these individual markets around the world. another great example would be safe refining margins around the world . how profitable are certain refineries. when they are run certain types of crude through their plants. >> reviewers want to check it out sp global.com. a lot of calls reright up for you. john,montgomery alabama, independent . >> good morning, how are you. >> host: what's your question for jeff bower? >> caller: comments like republicans are going around,

we were energy independent the last five years of republicanism to my question to you mister mauer is during any point in the past five years has the united states ever produced more oil than they consume number one. number two is good, do we have the capacity in america to produce enough oil to overcome the effect that opec house on the global price of oil. >>. >> we did become, the united states did come in crude exporter i think last year. i again i don't remember all the data but we export, the united states export a lot of fruit. i think crude exports last week or something like 4 million barrels a day but lately they've been around 3 million barrels a day and the united states also exports a lot of refined products so a lot of magasoline, a lot of diesel. mexico is a big buyer of refined products.

other countries in south america, big buyer of refined products from theus . so not we can produce so much , well let me think about that. i think you could because it's a global market, number i don't know what it could be because it's a global market your shippingcrude . two locations in like i said exporting lightspeed through to europe for exporting heavy crude to asia your competing with opec in other words in these regions. so that actually helps you're adding that supply helps to bring down the price for can help bring down the ta price . unless i'm trying to answer your question but the main point i want to make is it's this global market and when we do export, when any country is able to access

that actually helps to compete with other producers and refiners around the world . and can help to bring prices down . >> indianapolis indianathis is stephen . >> good morning. i have two questions and i want to follow-up off the last question on independent. i like to know how trump was able to persuade americans we were all independent. we are not all independent. that's my first question. my second question has to do with capitalism . the first lesson we learned in elementary school is as far as capitalism is where the demand is great for prices later. right now there's demand for fuel so the price is greater. why is it that the democrats will not are afraid to come out and say it. we are not socialists but

capitalism is at work at this time which is creating these problems. >> host: mister mauer. >> guest: the first question has to do with trade flows. are we the united states was more independent as the us increased its crude production. but there was a certain type of crude being produced. that wasn't really geared up or i should say a lot of refiners in the gulf coast work geared up to crude, they were geared upto run heavier crude . so it made sense that exports on like crude and continuing imports, imports from saudi arabia and crude have gone in the midwest towards nothing and even in the gulf we don't import a lot of crude.

there's some regular imports into the west coast but that's a good example. a lot of that i think has come from an increase in canadian imports which competes with saudi grooves and mexican groups. and naturally help to drive some of those were born imports. we have become more independent but the canadian crude is over 3 million barrels a day, 30 4 million barrels aday being imported into the us . that big regular buyer of crude . >> was the difference between sweet and sour crude? >> guest: crude has solar, that's it and there's all sorts of different levels but a sweeter crude, a lighter sweeter crude is easier to produce. sort of the lower solar products in demand for

instance like diesel. when you think of europe there are very dependent on diesel for transport. so lights sweet crude is very much in high demand. >> host: to david thnorthport new york, your next. >> caller: i remember in 2020 during the crash in oil at the time i think saudi arabia and russia were working together to push erdown the price of oil to undermine the fracking industry. now the fracking industry functions at a higher price of oil by loading up on massive amounts. but the interest rates artificially low was able to maintain that debt. at this point at $80 a barrel it seems like a good spot for fracking to be productive. i'm curious to what's going on with the fracking industry

. >> that's a good question.i think you're right. the break even in the price i guess to break even in something like the basin is around $43 and owwhere well above that so you got to wonder why aren't we producing more out of these places. but again i think it comes down to the cautious view. for a long time a lotof these producers were just producing . and not necessarily a profiting off of this but over time they started bringing more promises to rain that it is a weird thing and more cautious about that. there's an interesting example from earlier this year. dot oil producer on an earnings call mei think it was in february said something like you know, we might be able to return to pre-

covid-19 production by 2022. they didn't say were going to do it but just by them saying it sent their share price down like six dollars in one day. and you just sent a signal. oh wait, on other producers going to do this? or are theyconsidering it, are other producers going to do that ? they walked back later and now they're very explicit saying maybe five percent. 85 percent production growth next year. so they're just being very cautious about that. the although they are adding production. we are seeing again i think the tias this morning came out eeand said they saw maybe i think 1 million barrels a day being added by the end of this year. largely from up 1,000,000 and a half us producers and analytics it seemed like another million coming on by

next year. but again it's very gradual increase. a lot of that increased so far has come from not necessarily new drilling although we have seen an increase in rates activity but the completion of wells that have already been drilled so docs completed. these have actually diminished over the last year or so as they been completed and that's where the sort of production that added to the market based on the us coming out of this uncompleted wells . >> coming back to prices as they stand today aaa map had prices today at $3.41 a gallon as an average around the country. i wonder members of congress were calling for capping the strategic petroleum reserve . what is that, is that a

quick fix to this problem? >> that's an interesting one because you got to think what our bidens options here, they tried to go into opec, getting them to release more, add more production and then ea there have been some officials who said maybe we should just spend the crude exports or hold them temporarily. i think that would be pretty disruptive. the idea i think there are those who say ifyou hold career exports that would keep more crude in the united states . but it's like when you think about how much crude has been again, you promised to deliver to other trading partners around the ,world. how much time would you need to advance notice to do something like that? would you really want to disrupt the flow for some sort of ... in the hopes of

pushing down prices in the us ? i think the spr release seems like a more realistic approach among those. the idea is we have 613 million barrels and strategic reserves and because we no longer import as much crude as we used to the argument is maybe we don't need as much of that as we use to. it's supposed to be there for an emergency during hurricanes and so forth or times of war but the argument is like we produced so much more nowdo we need to have that much crude ? so the idea is maybe we can release 30 million barrels or 60 million barrels or something on the market and bring prices down. the counterargument is that well, it would be temporary. you would lose that crude

then maybe you'd have to refill it down the road. but yoi don't know. the counterargument to that is the biting administration is saying a lot of this is transitory anyway. they seem pretty confident that the price rise along with again nursing inflation for all sorts of different rights, oil and gas just some of those goods with the inflated prices. but the argument is well, maybe this is transitory so the release of spr, sure. it would help pull down prices temporarily but maybe that's all they want. maybe that would be good enough but i'm not sure how much crude it would take to bring those prices down. i suppose what the ministration could do is just wooffer out there and see who takes it. about five minutes left with jeff bower. global sees america's oil news director they're taking your questions. your calls about gas prices around the country. steve in california, thanks for y?waiting.

>> i read an article that suggests the oil companies could put more fuel on the market but it's more profitable for them to keep the price at the pump high and that it improves their stock position and if their stock position was worse in the 2010s when the consumer would say we demand lower prices and they would pull more gaps on the market and the prices would go down but then they would lose money profitability so none of the dynamics of the oil industry benefit your average american in any way, do they? >> to your point if you you want to be profitable.

it does make sense but there are this is an unusual time. again, we are recovering from a big drop last year and demand in last year. and again, they don't really want to add so much. i get your point. they don't want to add so much production that they risk not being profitable. and then they've made this promise to their shareholders . we're going to stick to this so i get that and as far moas the benefits i think a lot of the frustration comes from the fact that gasoline is something that we use every day. it's not a luxury so i get back. when prices rise for whatever. a new jacket you wanted or a something you could put off, you could say maybe i will

build that condition or redo the kitchen cabinets i'll wait until lumber prices come down but you need to eat every day andyou need to fill up the tank . and especially if you're in part of the country where your driving so i think that's where the frustration comes from. and i get that. it's a tough one. >> in this conversation about gasreturned to nitro in rockaway park new york . nitro, good morning. >> caller: good morning john and jeff. i just hwas doing a little research this morning. and the aaa numbers at 341 a gallon average of the united states but global petro price.com has the average price at 3.76, $3.76 after a gallon. there are global prices of oil. where meach individual country

customer pays. a dollar amount. america is blessed. we don't know how good we have it. uwhen you look at countries like ireland. paying twice as much for a gallon of gas. europe is hardest hit. middle east,they've got cheap gas . africa, even has good gas. but we have people who oil-producing states tend to be right leaning. texas, oklahoma, wyoming. and there is i believe there is concerted price fixing. okay? >> host: what do you think? >> i'm not sure about that. on the global market prices fluctuate all around. even before you get to the

retail level. when you get to the retail level you talk about higher taxes. higher taxes in different locations in europe or even different regions can add add a lot to the prices. i paid i filled up in the bronx the other day. i paid four dollars a gallon so it's expensive to fill the tank although i don't drive every day. so i'm lucky about that but it can get up there. and then you have some countries where the price is subsidized and you have an artificially low price. compared to what else is going on in the market. as far as fixing goes, i don't know how you would, i thought about thatbefore. i'm not sure how you would fix the price on a global scale . it seems like there's only players, so many different components to it and so many barrels tradinghands . you have to many different companies. i don't know how that would happen . it's possible on a regional

basis and i think it's why the administration is looking into it. they're looking into gouging now but i think they're probably referring to gouging in different locations. what different regions. >> host: last call, jim in wilson north carolina. >> caller: thank you for taking my call. when bush was in office gas was 20 years ago, gas was five dollars a gallon. i remember saying it's supply and demand. this is why they say, there all on our federal lands over the years belongs to the people. all these foreign countries come over here drilling. i don't know why we havethese spills like we did . because they're not following the regulations and then

they're making a profit. this belongs to us. while we on the federal lands one of the people own them we can drill in their , those wells off and when we have a problem like this we can take our ownoil . why is this always a profit thing? >> host: i want to let jeff miller come in. >> guest: what the government does is they lease out lots on that land to oil companies who paid for those lots. then cthose companies had a right e.to drill their and produce that oil but they are royalties that are, that they pay. that is companies pay back to thegovernment . for instance louisiana has the offshore industry so they get a lot of money from oil companies that aredrilling .

people have proposed we should raise royalties. maybe not what would get to where you're arguing or get a little closer to your argument there is a big i think it's interesting a big lease sale coming uptomorrow . there's been a lease sale on the golf. i remember when biden first came into office one of the things he was able to halt oil and gas lease sales for review. it went to court and the court said you need to hold this lease sale so they're going to be holding on one tomorrow. it's like 15,000 barrels. the golf has barrels of recoverable oil and it will be an interesting lease sale to watch because it may give you some indication on how oil companies review the future. how willing are they to be jumping in and bid up lots to

explore and produce in that area. one theory is you might see more activity because of concerns that the administration might take a harder stance down the road on leasing so maybe it's like get it in now while we can. the other arguments is why now it's your questioning oil and gas future, if your questioning the future of fossil fuels because of energy transmission or something we haven't talked about much today when you think of the pressures from the transition to cleaner energies, you have to wonder how profitable is this going to be down the road if well and gas is going to drop in favor of cleaner energies.

>> host: will have to end there, just mauer is director of america's oil news . youcan see his analysis on twitter . he's easy enough to find out mauer jeff. thanks for the time this morning. >> thank you for having me. >> wednesday federal communications chairman eight and other nominees testify at the confirmation hearing before the senate commerce science and transportation committee. want to live at 10 am eastern on c-span3, online at c-span.org or watchful coverage on our new video app. >> american history tv, exploring the history of events that tell the american story at 3 pm eastern, brett baer discusses his book to rescue the republic, ulysses s grant, the fragile union and prices of 1876 in which

he argues grant presidency has been underrated and at 4 pm eastern a symposium on robert caro that runs in conjunction with the opening of the new york historical society's execution and inside the robert caro archive. speakers include bob woodward and aquino address. exploring the american story what american is a repeat on c-span2 and find a schedule on our program guide or watch online anytime c-span.org/history.